Connex17 – ALE´s first European Analyst Conference Wrap-up

Frenus was in attendance at Alcatel Lucent Enterprise’s (ALE) first European analyst conference at its Paris headquarters on the 18th and 19th of May. The company which is owned by the Chinese networking company Huaxin presented an overview of its latest transformation efforts taken in order to address digitalization.

The senior management team from ALE first revealed its Vision 2020 strategies through a slew of presentations to analysts across Europe, backed by extensive live demos of their voice and data solutions in their Executive Business Center showroom. The program then culminated with one-on-one meetings with the respective department heads to gain deeper insights of the company’s efforts.

In 2014, China Huaxin Post & Telecommunication Economy Development Center (China Huaxin) acquired the enterprise networking division of Alcatel Lucent for EUR 202 mn. As a part of the deal, Alcatel Lucent (now Nokia) maintained 15% of ALE with the rest 85% going to Huaxin.

Business transformation at ALE started due to Huaxin’s vision of long-term commercial growth in the ICT sector. This acquisition has provided ALE the means and resources necessary to strengthen its ambition to attain leadership positions in enterprise communications and networking due to Huaxin’s position as a strong and recognized investor.

The core focus was on its transition from being a traditional provider to an advisory company with an outcome-based delivery model in the networking and communications sector while addressing digital transformation and the Internet of Things (IoT). Placing the company’s business transformation as a key focus at the CEO’s office is a bold strategic move taken to drive transition throughout the company.

Industry Verticalization

ALE, in line with its new motto “Where Everything Connects” has reorganized its entire portfolio and sales approach through an industry vertical approach combined with cloud and AaS voice and data offers to address digitalization. ALE is going to market with solutions which will be highly customized based on client requirements to ‘solve a business problem’. This solution customization strategy is a different approach compared to the large vendors in the industry who generally bank on solutions being scalable rather than individualized.

Revamped Sales Strategy

At the event, Rukmini Glanard, SVP of Europe North articulated ALE’s new sales strategy regarding the bifurcation of the sales team into four new regions: Europe North (EUNO), Europe South (EUSO), Asia Pacific (APAC), and North America (NAR). Additionally, the company has reworked its Channel Partners Program with clear directives for partners.

It was interesting for us to see how ALE is taking a real effort to change its processes which have become deeply ingrained over time to address new age digitalization. Also notable are the advantages of the business model transformation like facilitating quicker decisions and leaner processes while being backed by a strong investor. ALE is also pushing hard and fast on its current transformation strategy which will enable the company to navigate the dynamic IoT market situation and be the mantra for success, and became real with major IoT projects rolled out already, like the Gotthard Tunnel network, the longest in the world, connecting 70.000 objects. We are certainly looking forward to where the company will be heading towards in the near future.

Author: Thomas Allgeyer

Founder and Managing Director of Frenus since 2010
Formerly employed by Vodafone, Oliver Wyman and Mercer Management Consulting in the fields of Strategy, Restructuring and Project Management
Background: Degree in Economics at Hohenheim University